By: Yale Bock
The United States and Iran are currently at an impasse with respect to the conditions each country is willing to accept for the Persian realm. There are major disagreements over Iran’s ownership, possession, and use of nuclear material, the control of the international waterways of the Strait of Hormuz, and the funding of satellite organizations that are responsible for terrorism across the globe, especially in the Middle East. No less important are Iran’s appalling treatment of its own citizens and neighbors in the region. The important question is, how will they be resolved? Will it be through negotiation, or with a resumption of military activity?
From an economic perspective, the primary issue is what happens in the Strait of Hormuz? If you are a Gulf country that relies on the production and export of gas and oil-based products, the public comments of these entities are that it is unacceptable for them to have to pay a unit toll to Iran on shipments. From a long-term perspective, that will not work for the U.S. and its allies. It is already apparent that the non-Iranian Gulf countries are looking for alternative shipping routes for energy-related products in the future. The countries of Europe and Asia know this is a more important issue for them because they receive a large percentage of their energy supplies from this region. The toll issue is more pertinent to them than a resource-rich country like the United States. Countries in Europe and Asia are making plans about how to handle the Strait of Hormuz issue, but their willingness to accept economic extortion by Iran is probably very minimal as well. Look for the world to find a way to get Iran to back off on this critical issue.
The United States relationship with the countries in Europe, and specifically those of the North Atlantic Treaty Organization, is under severe pressure as a result of the lack of cooperation by the major Western European allies during the Iranian conflict. Repeatedly, a minimal request to allow a fellow NATO ally to use airspace to fly through was denied to the United States. As a result, the current US administration rightly asks what the point of being a member of an organization that is supposed to support one another is when, historically, the easiest and most straightforward actions are denied. This has heightened importance during the course of a major military event, which involves the United States at war with a country that is actively seeking to use ballistic missiles against NATO countries. It is hard to see a future where the United States is part of this alliance.
Turning to the Western Hemisphere, it is very apparent that the current US administration views anything close to home as off-limits to foreign adversaries. The most obvious potential problem is the deep connection and financial support of China in Brazil, which has accepted billions of dollars of aid and investment in logistically advantaged ports and infrastructure. China needs oil and gas from wherever it can get it, and Brazil’s Petrobras can deliver. Look for this to be a continuing source of conflict both today and in the years ahead. Obviously, US control of oil in Venezuela and the potential for future regime change in Cuba after the Middle East conflict gets settled are major topics to pay attention to as the year progresses.
Originally posted on May 1, 2026 on Y H & C Newsletter
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VIA SHUTTERSTOCK
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